Ceat´s Sri Lankan joint venture Radial Plant inaugurated

Ceat Ltd has announced that Sri Lankan Prime Minister Hon. Ratnasiri Wickrarnanayae along with Mr P K Chowdhary, Managing Director, of the Company on September 08, 2006 inaugurated the state-of-the art Radial Tyre plant of the Company Srilankan venture. The fully automated, temperature & humidity controlled plant, located at Kelaniya near the Sri Lankan capital Colombo, will be Sri Lanka’s first radial tyre plant.

Setup with an initial capital of SLR 350 million, the high productivity plant will have an initial installed capacity of 26,000 tyres per month. Catering both to the domestic and export market of the Company, the plant will initially focus on two ranges of radials - for Cars and vans, which are currently the most sought after sizes in the local market.

The Company´s Managing Director Paras K Chowdhary said, "We are extremely happy to further strengthen our long-standing & esteemed relationship with Sri Lanka, Indian companies are increasingly harboring global ambitions & so do we at CEAT. Our new hi-tech Sri Lankan facility, will be a significant step forward in this direction".

The technology imported for the new plant comprises of the latest, state-of-the-art equipment, for increased accuracy and productivity. Each electro-pneumatic machine requires just one operator to input a sequence of commands and then motor process. The fully air conditioned radial plant has also been designed with a focus on safety.

Built alongside the existing plant in Kelaniya, the Radial plant will produce T-rated steel-belted radial tyres with high durability polyester carcasses and unique tread patterns designed for Sri Lankan roads. The Company will initially manufacture nine different sizes of steel belted radials for cars and vans, branded ‘Formula 1Steel" and ´Rhino´, respectively including the popular 175/70 R13 & 185/70 R14 sizes for cars, & 185 R14 and 195 R15 sizes for vans.

"The Sri Lankan Tyre industry has today truly come of age with our new global class facility. Tyres manufactured here, will be customized, especially in their tread patterns, to cater to Sri Lankan requirements. It will provide consumers with key benefits such as good mileage, riding comfort, and excellent road handling and safety. It will cater to most models of cars and vans, providing motorists with international standard tyres matched to local road and usage conditions." said Mr Oscar Braganza, MD/CEO, CEAT Sri Lankan venture.

CEAT Sri Lankan venture already has a market share in excess of 50% in the segments in which it operates. It also plans to export light commercial vehicle (LCV) and passenger car radials from the plant to the Indian market, taking advantage of the FTA between India and Sri Lanka.

The unique features of the products, to be rolled out of the new plant, include a center rib that provides improved steering & handling capabilities, while the parallel ‘see through’ channels aid water removal. Parabolic grooves in the tread pattern provide increased traction and better grip to prevent spinning & enhance braking in keeping with the Company brand motto of being ´Born Tough´, the radials for vans will have the additional benefit of being robust to carry extra heavy loads, a requirement in keeping with local practice in Sri Lanka.

"At first glance, the locally produced CEAT radial tyres would look like any other high- end imported tyres. However to an expert eye, the new tyre would reveal many features that represent quality and s performance attributes. In this last growing market, our strategic thrust will be to cater to the new discerning Sri Lankan customer, who seeks style, safety & performance," Mr Oscar Braganza added.

The Company plans to increase its production capacity to 100,000 passenger car radials per month within six months of achieving an enhanced production capacity of 65.000 tyres. This increase in production coupled with free import norms from Sri Lanka will enable the company to gradually cater to the growing passing car tyre segment across South Asia.

Source : Equity Bulls

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